CPP market statistics show increasing appetite for Grade A City Centre office space
Office uptake in Sheffield has soared by more than 100% in the first quarter of 2019 compared to the same period last year, according to the latest market statistics released by Commercial Property Partners.
The figures released by the leading commercial property agency found that uptake was particularly strong in the City Centre as more firms look to secure quality premises with excellent transport links in a bid to ‘aide recruitment, staff retention and growth ambitions’.
Take up for the first quarter was 200,651 sq ft – up from 93,951 sq ft in Q1 2018 – across Sheffield. CPP reported a particular increase in demand for Grade A facilities which accounted for over 166,176 sq ft of the total figure.
A total of 23 deals occurred over the three month period, the most significant of which was the completion of the 15-year lease agreement of HSBC’s new Sheffield Headquarters in Grosvenor House which forms part of the new Sheffield Retail Quarter. Despite this deal accounting for the majority of the activity, the remaining activity still showed a healthy level of take up.
The figures also revealed strong acquisition activity within the professional and business services sector, with companies such as Ansys and Dassault Systemes securing more than 30,000 sq ft of the total office space during the period.
Meanwhile, the City Region’s growing number of creative industry businesses accounted for 8,000 sq ft of space, with local agency Uber moving into the top two floors of the historic Eagle Works at the Little Kelham development, and agencies Joi Polloi and Vivid Creative both moving into the sought after Wharncliffe Works.
More than 90% of office space secured throughout the quarter was in the City Centre.
Rob Darrington, Partner at CPP, said: “There has been a notable upward trajectory of interest in Grade A office space in the city centre, which has been fuelled, in part, by a real demand for a quality facilities that boast excellent local amenities and transport links.
“Our clients often cite ‘staff demand’ as a reason for this and, with many of the companies in question taking on larger premises as part of a move, we understand that recruitment is also an important factor.”
According to Darrington, there has been significant investment which has taken place in recent months to upgrade much of the City Centre stock – with major refurbishment projects being undertaken at buildings such as Dearing House on Young Street, and City Gate which was acquired by Longmead Capital last year.
He said: “The amount of Grade A stock that has been bought to market recently has been significant, and the quality has been exceptional. However, there is not an endless supply of buildings that are undergoing, or eligible to undergo, such extensive refurbishment.
“There is a risk therefore that the offering will slow, which means there is a real demand at the moment from companies looking to secure that limited stock.
“As it currently stands there remains a comprehensive portfolio of properties available for occupiers seeking sub 20,000 sq ft. However, any larger occupiers seeking a greater amount of space will now be forced to either wait or consider pre-let opportunities. Demand currently outweighs supply meaning that the lack of stock will inevitably effect take up stats over the next few months.”